Dhanuka Realty Ltd Management Discussions

INDUSTRY OVERVIEW

Indias real estate sector continues to be a key driver of economic growth and urban transformation. With increasing urbanization, rising income levels, and infrastructure-focused policies, the demand for quality residential, commercial, and hospitality spaces is on the rise.

The sector comprises four major verticals: residential, commercial, retail, and hospitality The sector ranks among the top contributors to employment in India and is poised for sustained growth, driven by ongoing investments in smart city initiatives, transportation infrastructure, and large-scale housing developments

As Indias population shifts towards urban centers, the need for integrated townships, commercial hubs, and tourism infrastructure is stronger than ever. This positions the real estate industry as a cornerstone of sustainable development.

COMPANY OVERVIEW

Established in 2008 and headquartered in Jaipur, Dhanuka Realty Limited is a diversified real estate and infrastructure development company with a strong track record in the Rajasthan market.

The Company is actively engaged in:

Residential and commercial real estate development (on owned and contract basis) Land aggregation and consolidation services for institutional and private clients Tourism and hospitality infrastructure development, including hotel and resort projects

Designing services, including architectural planning, layout design, and project visualization

With a focus on quality, transparency, and timely delivery, Dhanuka Realty Limited has grown into a trusted name in the Jaipur region. The Company is part of a larger business group with deep roots in real estate development and infrastructure.

BUSINESS OPERATIONS

Dhanuka Realty Limiteds core business activities include:

Designing, developing, and executing residential apartment complexes and townships Constructing commercial office buildings, retail spaces, and hospitality assets

Providing land aggregation services to support large-scale developments

Offering end-to-end designing and planning services, catering to both internal and client projects Developing tourism infrastructure, including hotels, resorts, and related facilities

The Company undertakes both in-house projects and contract-based developments for public and private sector clients.

KEY STRENGTHS

Strong regional presence with a solid project pipeline in Jaipur and surrounding areas Well-recognized brand image built on trust and consistent delivery

Emphasis on high-quality construction and architectural design Experienced leadership and multidisciplinary project teams

Established relationships with stakeholders, contractors, architects, and financial institutions

BUSINESS ENVIRONMENT & CHALLENGES

Several factors influence the Companys operations and industry performance:

Macroeconomic indicators such as GDP growth, inflation, and interest rates

Regulatory frameworks like RERA, GST, and local municipal approvals Availability and cost of construction materials, labor, and design talent Shifting consumer preferences, especially for well-designed and functional spaces

Access to project financing and buyer credit facilities

Delays in land approvals and procedural clearances

SEGMENT PERFORMANCE

Dhanuka Realty Limited operates as a single business segment, focusing on integrated real estate solutions. The Company generates revenue from:

Residential and commercial project development Design and architectural services Land aggregation contracts

Infrastructure assignments, including those in tourism and hospitality

OPPORTUNITIES

Indias real estate market continues to offer promising opportunities in:

Affordable and mid-income housing, driven by strong demand and government incentives

Commercial and mixed-use developments, especially in growing cities

Expansion of the tourism and hospitality sector, encouraging hotel development

Growing demand for customized and high-quality design services Interest from institutional investors and global developers in Indian real estate

RISKS & THREATS

While the outlook is positive, the Company remains cautious of:

Regulatory and policy delays in approvals and project launches Rising interest rates and financing constraints

Retrospective policy changes impacting profitability

Competitive pressure from both organized and unorganized developers

Market slowdown due to macroeconomic or political instability

FINANCIAL HIGHLIGHTS (FY 2024 25)

The Company achieved a strong financial turnaround, with improved profitability Completed key projects in both residential and infrastructure segments Delivered design consultancy services for multiple third-party developments Enhanced project execution speed and operational efficiency

OUTLOOK FOR FY 2025 26

Dhanuka Realty Limited enters the upcoming financial year with a clear growth strategy focused on:

Expanding residential and commercial portfolios across Rajasthan and other emerging cities Strengthening its position in design and planning services

Expanded its service portfolio by providing land aggregation solutions to support large-scale real estate developments.

Launching new tourism-focused infrastructure projects, including hotels and resorts Enhancing project delivery timelines through digital and architectural innovations Exploring new collaborations to scale up business across verticals

With its integrated model spanning development, design, and construction, the Company is well-positioned to capture the next wave of opportunities in Indias evolving real estate and infrastructure sectors.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Companies Act, 2013 re-emphasizes the need for an effective Internal Financial Control system in the Company. The system should be designed and operated effectively. Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Boards report.

The Companys internal control system is commensurate with the nature, size and complexities of operations. Adequate records and documents are maintained as required by laws. The company has established well defined polices and processes across the organization covering the major avidities. The Companys audit Committee reviewed the internal control system on an ongoing basis keeping in mind the growth prospects and ever evolving business environment. Audit committee reviews proper implementation of corrective measures. All efforts are being made to make the internal control systems more effective.

To ensure effective Internal Financial Controls the Company has laid down the following measures:

All legal and statutory compliances are ensured on a monthly basis. Non-compliance, if any, is seriously taken by the management and corrective actions are taken immediately. Any amendment is regularly updated by internal as well as external agencies in the system.

Approval of all transactions is ensured through a pre-approved Delegation of Authority Schedule which is reviewed periodically by the management.

The Company follows a robust internal audit process. Transaction audits are conducted regularly to ensure accuracy of financial reporting, safeguard and protection of all the assets. Fixed Asset verification of assets is done on an annual basis.

RISKS AND CONCERNS

Every business has both Risk and Return and they are inseparable. As a responsible management, the Companys principal endeavor is to maximize returns. The Company continues to take all steps necessary to minimize its expenses through detailed studies and interaction with experts. Our senior management identifies and monitors the risk on regular basis and evolves process and system to control and minimize it. With regular check and evaluation business risk can be forecasted to the maximum extent and thus corrective measures can be taken in time.

FINANCIAL PERFORMANCE & OPERATIONAL PERFORMANCE:

A. FINANCIAL CONDITION:

Capital Structure:

The Paid-up Share Capital of the Company as on 31st March, 2025 is Rs. 7,74,00,400 divided into 77,40,040 Equity Shares of Rs. 10/- each fully paid up.

During the year the Company has not transfer any amount to Capital Reserve.

Fixed Assets:

During the financial year 2024-25, fixed assets were Rs. 0.068 lakhs

Sundry Debtors:

Sundry debtors are Rs. 285.53 Lakhs as on 31st March, 2025 as against Rs. 52.26 lakhs debtors in the previous financial year.

Cash and Bank Balances:

Cash and Bank balances stood to Rs. 10.62 lakhs as against Rs. 11.14 lakhs in the previous year.

Loans and Advances:

Long Term Loans and Advances is NIL in Current Financial Year as against NIL in previous year. Short Term Loans and Advances is NIL as against Rs. 121.25 lakhs in the previous financial year.

Current Liabilities:

Current Liabilities as on 31st March, 2025 is Rs. 915.11 lakhs as against Rs. 884.55 lakhs in the previous Financial Year.

B. OPERATIONAL RESULTS

Turnover:

During the financial year 2024-25 the turnover of the Company was Rs. 312.72 lakhs and income from other sources as on 31st March, 2025 was Rs. 48.71 lakhs as compared to the turnover of the company on 31st March, 2024 as Rs. 208.19 lakhs and income from other sources was Rs. 58.48 lakhs in the previous financial year.

Depreciation:

The Company has provided for depreciation of Rs. 0.54 lakhs during the financial year 2024-25 whereas depreciation of Rs. 0.664 lakhs was provided in the previous financial year.

Tax Expenses:

The Company has provided for tax expenses of Rs. 29.81 lakhs in the financial year 2024-25 whereas in the previous financial year company had provided for tax expenses of Rs. 3.71 lakhs.

Net Profit:

The Net Profit of the Company after tax is Rs. 88.69 lakhs for the Financial Year 2024-25 as compared to Rs. (12.29) lakhs in the previous financial year.

Earnings per Share:

The Earnings per Share of the Company as on 31st March, 2025 is Rs. 1.15 per share for Face Value of Rs. 10/- as against Rs. (0.16) per share for Face Value of Rs. 10/- in the previous financial year.

HUMAN RESOURCES

Management is doing successfully in building experienced team and nurturing them to be leaders. The main motive of the company is trust, integrity, teamwork, innovation, performance and partnership. Various Departments are headed by Professional Qualified Personal, helping our business to remain competitive, achieve greater success and newer milestone.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS

A detail of significant changes in key financial ratios, along with detailed explanations is as follows: